In response to unprecedented foreign sanctions, the State Council issued the Regulations on the Implementation of the Anti-Foreign Sanctions Law (AFSL) on 23 March 2025, providing a legal framework for China to impose its own countermeasures.
This article outlines key provisions of the new regulations, which elaborate on the 2021 Anti-Foreign Sanctions Law (AFSL), expanding its application.
Expanded scope
Counsel
Tahota Law Firm
Tel: +86 10 8586 5151
E-mail:
guogang.li@tahota.com
The AFSL defines the targets and scope of its countermeasures in article 3.2; namely that the provisions apply to discriminatory restrictions or interference in China’s internal affairs imposed by foreign states against Chinese entities or individuals under any pretext.
The regulations reaffirm these provisions while introducing an additional scenario warranting countermeasures when foreign states, organisations or individuals engage in, assist or support actions that endanger China’s sovereignty, security or development interests.
This expansion broadens the scope of applicable countermeasures in three key aspects:
- Wider range of measures. Countermeasures now apply not only to foreign interference in China’s internal affairs but also to actions threatening national sovereignty, security or economic interests.
- Broader targets. The scope extends from foreign states to include specific organisations and individuals.
- Expanded conduct. Countermeasures may now address not just direct sanctions but also third-party assistance or support for such measures.
The regulations further extend countermeasures to include foreign judicial interference. Article 19 stipulates that foreign state entities or individuals involved in litigation or enforcement of judgments that undermine China’s sovereignty, security or development interests may now face sanctions.
Crucially, the scope covers not just administrative actions but also participation in legal proceedings and enforcement of foreign judicial rulings.
Elaborated countermeasures
The regulations elaborate on the four categories of countermeasures specified in article 6 of the AFSL, clearly delineating enforcement responsibilities among State Council departments.
- Immigration controls – including visa refusal, entry denial, visa revocation and deportation – to be implemented by the Ministry of Foreign Affairs and the National Immigration Administration;
- Asset restrictions – involving the seizure, freezing or confiscation of property – to be enforced by relevant authorities including the Ministry of Public Security, Ministry of Finance and regulatory bodies for natural resources, transport, customs, market supervision, financial management and intellectual property;
- Sectoral co-operation bans – prohibiting collaboration in education, science and technology, legal services, environmental protection, trade, culture, tourism, healthcare and sports – to be implemented by respective ministries and administrative bodies governing these sectors.
The regulations specify that frozen assets under economic sanctions include cash, bills, bank deposits, securities, fund shares, equity, intellectual property, accounts receivable and other property rights.
Other measures
Regarding sanction mechanisms, the AFSL adopts key measures similar to those employed by the US Treasury and State Department, principally asset freezes and visa restrictions.
The legislation also includes a catch-all provision for “other necessary measures” in article 6.4. The regulations clarify these additional measures, focusing primarily on import/export controls, foreign investment restrictions and data governance.
These provisions encompass, but are not limited to: bans or limitations on China-related trade activities; bans or limitations on investment within China; export controls on specific items; prohibitions or restrictions on data and personal information transfers; revocation or limitation of work permits, residence rights or stay qualifications; and financial penalties.
The regulations also incorporate export controls, investment restrictions in China and cross-border data management into the countersanctions framework, significantly expanding both the scope of these measures and their legal basis.
Notably, export controls may now be applied not only for national security and non-proliferation obligations – as stipulated in article 1 of the Export Control Law – but also as countermeasures against discriminatory actions by foreign states under the AFSL and the regulations.
Detailed liabilities
Article 14 of the AFSL stipulates that any organisation or individual failing to implement or co-operate with countermeasures shall bear legal responsibility – but without specifying enforcement mechanisms. Article 13 of the regulations now provides explicit provisions. Authorities may:
- Order corrective action;
- Impose restrictions on participation in government procurement, tendering, import/export activities and international service trade;
- Prohibit cross-border data or personal information transfers; and
- Restrict exit from or residence within China.
These detailed provisions significantly enhance the enforceability and deterrent effect of the measures.
The regulations further establish clear administrative procedures for implementing countersanctions, including investigation processes, consultation mechanisms and information disclosure requirements.
Significantly, the provisions introduce for the first time clauses permitting adjustments to sanctions measures and exemptions for engaging with sanctioned entities or individuals. These provisions demonstrate the framework’s flexibility to adapt to evolving political and economic circumstances.
Li Guogang is a council at Tahota Law Firm. He can be contacted by phone at +86 10 8586 5151 and by mail at guogang.li@tahota.com
